February 25, 2015
MarketWatch reported that the survey showed office supply stores earned around $20 billion (€17.5 billion) in revenue in 2014, but that this has “been declining” at an average of about 2.6 percent every year for the past five years “mostly thanks to recessionary factors” including “weak consumer confidence and low disposable incomes”, as well as the “growing popularity” of both “discount and other retailers that may sell similar items”.
This is perhaps reflected in the recent merger between Staples and Office Depot in the USA, which The Recycler previously reported on, and which “couldn’t have come at a better time” according to Cartridge World North America, as the franchise network’s 1,200 stores expanded in 2014 to “become the only international franchise to provide printers, printer supplies and full-service support” to SMBs, filling a need “that big box and office supply stores are not meeting”.
IBISWorld stated that “traditional office supply stores have long been under pressure from discount stores, supercentres, warehouse clubs and online retailers [which] are able to offer lower prices, made possible by cost savings achieved through bulk purchasing and low overhead costs”, and the article noted that “if you’re looking for deals — even on basic stuff for work — you may want to look beyond your neighbourhood office supply store”.
In turn, office supply store revenue “is expected to continue to fall over the next five years”, again thanks “in part” to “increased competition from discount and other retailers”. Among the products that are cheaper at smaller stores include printer cartridges, with “price clubs” offering smaller stores “buying power” and meaning they were “often less expensive”. The survey added that online retail customers were also “more satisfied with their purchases”, which has meant business has been taken away from big and small brick-and-mortar shops in the US.
The report did add that for balance that “there are plenty of deals to be had” at the main chains, especially if items need to be shipped, while “savvy shoppers” can “score great deals” through coupons, loyalty programmes and “aggressive seasonal sales”, or through “being opportunistic” when looking for the cheapest price.
Categories : Around the Industry